We lower our price target to $5 (from $6) based on dilution from NEOV's announced 12.2 million share offering (up to 14.0 million based on the 30-day underwriter option), raising $25-$28 million. Funds raised from the offering will support initial production and ramp, including the working capital needs, of NEOV's new Georgia JV facility (80% owned by NEOV; the U.S. subsidiary of PotisEdge Co., majority owned by China-based LONGi Green Energy Technology [601012-CN]) holds 20%). We expect the relationship with PotisEdge and LONGi to be a strong advantage for NEOV as it enters the growing utility-scale market. The first shift on the initial line will have production capacity of 2GwH (total facility capacity is 8GwH), although we anticipate 1H:F27 production to focus on reference projects to prove capabilities and bankability. NeoVolta also announced a non-binding letter of intent (LOI) with Infinite Grid Capital for the supply of utility-scale battery energy storage systems (BESS), totaling about 1.1 GWh from the new Georgia facility. By our estimate, if converted to a purchase order, production would fill about 55% of initial capacity at the Georgia facility and generate revenue approaching $200 million. We expect success of initial runs and eventual purchase orders in late 1H:F27 would be the chief catalysts for the stock. The expanding utility-scale market provides significant growth opportunities, in our view. Our $5 price target (from $6) is based on 20x our lowered C2028 EPS estimate of $0.26 (previously $0.32). To us, the LOI is an important first step, but we raise our risk rating to high (from moderate) due to NEOV's entry into a new market and the challenging debt market environment and will reassess based on utility-scale purchase order announcements, expected in 1H:F27.